Fractional CEO / Employment before purchase?

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October 20, 2025

by a searcher from College of William and Mary - Raymond A. Mason School of Business in Alexandria, VA, USA

I'm going down the road with an entity and as I work to get financing in place, we have discussed me playing a role prior to deal execution. Thinking fractional CEO or business development or help with some tech integration. Does anyone have experience in this type of arrangement? I thank you in advance for sharing.
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Reply by an intermediary
in Jacksonville, FL, USA
I'd recommend a CEO who open to sweat equity. That way it's easier to accumulate retained earnings.
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Reply by a professional
from University of California, Hastings College of Law in Petaluma, California, United States
That’s a great question, and one we see come up often in ETA and self-funded deals. Pre-close or “bridge” roles like a fractional CEO, operator-in-residence, or technical advisor can work very well if the scope and expectations are clearly defined. In these cases, the engagement is usually structured as a short-term advisory or hourly arrangement focused on specific outcomes, such as diligence support, building the first 90-day plan, or setting up foundational systems ahead of close. At Five Experts, we see many investors and search CEOs use this model to accelerate post-close execution while still protecting both sides through clear deliverables and compensation terms. The key is alignment, document the role, define the triggers for payment (or transition to full-time), and treat the pre-close phase as the first sprint of value creation rather than a loose handshake. The most successful engagements have predefined outcomes agreed by all. If you like to hop on a call to discuss ways this can work specifically for your organization, we'd be happy to grab some time! - Stephanie at redacted
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